Growth is essential for any business a small, medium, or large. If you want to achieve growth in your business, effective business growth strategies are vital. But you have a question: what is a business strategy? How is it important for business? Which types of business growth strategies are effective?
We have curated some points for you to use effective tactics or strategies for your business.
What is business growth?
Business growth is a peak every business wants to reach where it expands in many ways like increasing market share and revenue, acquiring assets, and improving products and services.
What makes your business growth strategy effective?
Before choosing any growth strategy, you should understand certain points which can help you to utilize the growth strategy effectively.
First, you should have a clear idea of your brand, its positioning, strength, and differentiation.
Second, you should have a clear picture of your customer’s mindset, pain points, and approach toward satisfying their need better than your competitors.
And most importantly, you should incorporate small changes as well as large changes to accomplish your business goals and objectives.
What is a business growth strategy?
A business growth strategy is a technique or tactic, or plan to help the business expand and develop. The growth strategy involves specific projects, new products or services, mergers, acquisitions, partnerships, diversification into new markets, promotion of products and services, or some combination of these techniques.
Experts suggest three levels of a business growth strategy to achieve overall business growth.
The Corporate Level defines the company’s overall direction to achieve its long-term objectives.
The Business Unit Level defines a company’s business unit level strategy to strengthen a company’s products or services in a competitive market.
The Functional Level defines a company’s divisional or department-level strategy to uplift the functional area of a company.
What are the benefits of a business growth strategy?
When any company implements a growth strategy, the company can have many benefits in day-to-day operations to long-term goals.
- Companies can increase sales ad revenue by implementing a business growth strategy successfully.
- Companies can see noticeable differences in the share value of a company when they have implemented an effective business growth strategy.
- Companies can increase their visibility among new customers and markets by implementing effective business growth strategies.
Types of business growth strategy
Here are some growth strategies which you can incorporate in your business.
Market Penetration
One of the most important business growth strategies is market penetration for the existing products or services in the existing market by increasing a visibility of the brand. It can be done in two ways. Vertical penetration means that company will increase production, lower the price, create new products or services, etc. Horizontal penetration means that company will increase their brand by adding new products or services, increasing advertisements, or creating better products or services.
Market Development
It is to enter into a new market to ensure continued opportunity for growth. To include this strategy, companies need to research potential customers, develop brand awareness, understand the value of their products or services, build relationships with trade partners and customers, define customer needs, and develop strategic plans.
Product or Service Development
If any company wants to grow sales and revenue-wise, they should emphasize developing a strategy for their product or service development. You can do so by adding new products or services, or you can diversify your product or service line to stand strong in a competitive market. It is an important strategy of market penetration to distinguish it from other companies.
Market Disruption
Market disruption means entering into an industry that has few market players with dominantly holding the market. There are many ways you can disrupt the market.
- Use different and unique business model
- Use innovative approach
- Offer better quality products or services, or you can have cheaper rates
- Provide something new by eliminating the traditional approach
Product Expansion or Diversification
If you want to expand then diversification is one of the great ways. It can be done by entering into a new market, introducing a new product or service, or can introduce new features in your existing product or service. With this strategy, your target audience will remain the same, but you can add a wider segment of an audience through the functionality of your product or service.
What makes an effective business growth strategy?
Both internal and external factors impact on failure or success of a company’s growth strategies. Although internal factors can be manageable and can be controlled, external factors are not in one’s hands. We are giving some features of an effective growth strategy here to ensure that you make the right choice for your company.
- To ensure your growth strategy works for your company, you should include innovation to stimulate the innovative growth of the company. When you have a presence in an existing market, you should opt to expand in that market as one of the effective business strategies.
- Maintaining the integrity of existing clients is most important as most people rely on word-of-mouth promotion of business to choose the service or products. Focusing on brand awareness through brand integrity is one of the effective business strategies to acquire more clients.
- Giving a touch of imagination to your business growth strategies is essential aspect while choosing the right strategy as not every size fits all. It is difficult for some companies as they are well established and have good customer connections. However, you should note that the goals and business are different. Thus, you need different types of strategy for your business growth.
- Before working on growth strategies, you should consider the needs and wants of your current and potential clients. The strategy can be tailored and meet the expectation of your clients.
- When you focus on the organic growth of your company, it will help you to grow organically and sustainably. Organic growth has a powerful impact on your brand awareness. Most companies follow this strategy even while they are using external growth strategies.
Successful companies adopt the change in changing industries. They plan on growth, revise it time-to-time and work on it through research and development.
